"SBI will finance 85 per cent of the on road price of Mahindra Reva Electric Vehicles with tenure of 7 years and low interest rate of 12 per cent," SBI Mumbai CGM R N Mehra said in a statement.

He said under the deal, EMI on a loan of Rs one lakh for a period of seven years would be Rs 1,765.

Commenting on the deal, Mahindra Reva Electric Vehicles Chief of Operations R Chandramouli said: "With such highly competitive schemes and finance, we are hopeful of getting a good response from our dealers and customers."

Customers can repay the loan amount at any point of time during the repayment period without any pre-payment penalty, the statement said.

The two firms will to leverage on the inherent strengths of each other's vast network, it added.

SBI has 13,686 branches across the country while the SBI group has 18,506 branches. On the other hand, Bangalore-based Mahindra REVA is an electric vehicle maker from India that has deployed fleets of electric cars in the global market.